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ORIGIN OF PEPSI:
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The export-import ratio will be 5:1 over 10 years, which means that
for every dollar spends in foreign exchange on this project, the
company will ensure an export earning of 5 dollars for 10 years;
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♣ Pepsi
♣ Diet Pepsi
♣ Pepsi Aha
♣ Slice
♣ Mirinda
♣ 7-Up
♣ Aquafina Mineral Water
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TYPES OF PRODUCTS:
Non-alcoholic soft drink beverage market can be divided
into fruit drinks and soft drinks. Soft drinks can be further divided into
carbonated and non-carbonated drinks. Cola, lemon and oranges are
carbonated drinks while mango drinks come under non-carbonated category.
The soft drinks market till early 1990s was in hands of domestic players like
campa, thumps up, Limca etc but with opening up of economy and coming
of MNC players Pepsi and Coke the market has come totally under their
control. While world wide Coke is the leader in carbonated drinks market in
India it is Pepsi which scores over Coke but this difference is fast decreasing
(courtesy huge ad-spending by both the players). Pepsi entered Indian
market in 1991 coke re-entered (After they were thrown out in 1977, by the
then central government) in 1993.
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• Cola products account for nearly 61-62% of the total soft drinks
market. The brands that fall in this category are Pepsi, Coca-Cola,
Thumps Up, and diet coke, Diet Pepsi etc.
• Non-cola segment which constitutes 36% can be divided into 4
categories based on the types of flavors available, namely:
o Orange
o Cloudy Lime
o Clear Lime
o Mango
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iii. Clear Lime: this segment of the market witnessed good growth
initially with all the players launching their brands in the segment. But
now the growth in the segment has slowed down. The brands
available in this segment are 7 Up of Pepsi, Sprite of Coca Cola and
Canada Dry (earlier of Cadbury Schweppes and now of Coca cola).
The segment constitutes 3% of the total soft drinks market.
iv. Mango: this flavor segment constitutes 2% of the total soft
drinks market and it directly competes with mango based fruit drinks
like Frooti. The leading brands in this segment are: Maaza of Coca
Cola, Mangola (Earlier of Dukes now of PepsiCo) and Slice of
PepsiCo.
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The market growth of 22% till last year has got stifled
due to high excise duty of 40% leading to higher price of the end product.
Market Characteristics:
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pack sizes. But with increasing occasion led and home refrigeration led
consumption the sales of bigger SKUs like more than 1 Litre pack sizes has
increased this has led to increase in contribution from PET bottle sales to
15% of the total turnover in FY00. And most of these PET bottle sales, up to
75% are in urban areas.
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RETAILER’S PERCEPTION:
A survey was conducted to study the retailers’ views of
the present market, future trend and the consumer behavior patterns. The
findings of the survey are as follows:
• Retailers stated that the consumers are loyal to the particular segment
of the soft drink i.e. cola, orange or lemon. But as far the loyalty for
the brands in each segment is concerned, it is not very significant.
• 43% of the retailers surveyed told that in soft drinks advertising is the
key component in driving sales. While 32% stated promotional
schemes and 20% brand loyalty as the reason.
• As consumers are not very brand loyal where the purchase of soft
drinks is concerned, the retailer push becomes a critical issue. They
usually sell the product in which they get the maximum benefit. For
this, the companies try to offer them higher margins.
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COLA WARS:
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before the first bottle of Pepsi hit the shelves, local soft drink manufacturers
increased the size of their bottles by 25% without raising costs.
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The only thing you can say with certainty about the
Indian rural market right now is that it is the best trading ground for both
Indian and multinational corporations. A burgeoning, untapped market
estimated at nearly 150 million stretching across the length and breadth of
the Indian subcontinent.
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MARKETING STRATEGIES:
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Product:
A business needs to consider the products that it
produces and the stage of the product life cycle that a product is at.
Marketing strategies will vary according to the type of product and its stage
in the life cycle.
In case of Pepsi, in the rural markets, the 300ml bottle
and now days the new small or commonly known as the “chota pepsi” is
very much popular. The Pepsi Co. is even thinking of introducing their new
Pepsi-Aha, but presently they are concentrating more on the normal pepsi as
the rural market is a niche market. Pepsi is even successful in introducing
the big 1-1.5 liter PET bottles in the rural markets. These big bottles are very
popular during big festivals and marriages.
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Price:
Most businesses use a "cost plus" method for setting the
prices of their products. This involves determining unit production costs and
then adding in a profit margin. However, many other factors are involved.
Consider "perceived price" (what you think consumers will be prepared to
pay), demand elasticity (is it elastic or inelastic?), competitors' pricing (can
you afford to undercut their prices?), pricing objectives (what do you want to
achieve Ð increased market share? increased profits? market leadership?
etc.)
Example 2 Perfume
מ How much does it cost to make?
מ Can businesses afford a "price war"?
מ Why is Coca Cola so successful?
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Place
This generally refers to the physical locations of product
sales as well as the methods of distribution. However, it is also considered to
be the "place" or "position" in the market of the product; refer to information
below. Businesses need to make many decisions related to "place": access,
parking, competition, physical location etc.
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savings. “Colas service just 7.5-8 lakh accounts compared to the other
FMCG players who service three times the number. Innovation in our
distribution system will take us closer to the 21 lakh figure,” says Vats, a
franchise director.
Promotion
This refers to the promotion of the product to the target
market. This is achieved through a combination of: advertising: use of
electronic and print media. The "reach" (how many people will see the
advert), frequency (how many times will I advertise the product?) and
impact of the advertising must also be evaluated.
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Sales promotion: use of gimmicks and incentives e.g.
competitions.
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him and his brother. Though he will sing Yeh Dil Maange more, his brother
will say Yeh Dil Maange no more. “We have our lives and we have our own
choices,” he said on the possible in-house cola feud.
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